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  • FIRST POST
    • Lucyannexxx
    • By Lucyannexxx 8th Apr 18, 11:37 AM
    • 3Posts
    • 0Thanks
    Lucyannexxx
    Developers want to buy our house..
    • #1
    • 8th Apr 18, 11:37 AM
    Developers want to buy our house.. 8th Apr 18 at 11:37 AM
    Hi, any advice on this would be fantastic!
    My parents own a 3 bed semi in a bromley borough and were approached nearly 4 years ago now by developers wanting to build up the whole road (a total of 10 properties, 4 of which are council owned). Their plans included 103 flats spread out over 4 storeys and 4 separate buildings. This was in partnership with the local housing association and a building developer. So as you can imagine a massive project! My parents signed an option agreement originally for 500k, after a year the agreement ran out due to the planning process taking longer and due to my parents circumstances (massive mortgage due to remortgaging and illness) they were then offered 650k. The plans went in and were rejected by a panel, so this then went to appeal and this was also rejected due to the sheer size of it. However the option for 650k runs out soon and they are now being asked to sign again until December so they can draw up new plans in accordance with what it was rejected on (basically 4 storeys was deemed too high and over looked neighbouring houses).
    This has been going on for so long and their mortgage terms means it's is due to be paid fully in 2.5 years, by the time my dad turns 65. One of the neighbours refused to sign again last time and for fear of losing it the housing association bought it for a massive amount, what do you think the best option is?
    To not sign and open up the opportunity for other developers in the hope they but the property quicker than having to wait until December with no guarantee planning for these new plans will be granted,
    Or
    Call their bluff and not sign before the agreement runs out and hope they buy it quickly like they did the neighbours?
    Thanks
Page 1
    • Tom99
    • By Tom99 8th Apr 18, 12:59 PM
    • 2,628 Posts
    • 1,793 Thanks
    Tom99
    • #2
    • 8th Apr 18, 12:59 PM
    • #2
    • 8th Apr 18, 12:59 PM
    Do your parents get paid for granting these options? If not what's in it for them?

    Presumably the developer does not have to action the option they could say we have PP but can only offer you 550k.
    • Norman Castle
    • By Norman Castle 8th Apr 18, 1:16 PM
    • 7,415 Posts
    • 6,177 Thanks
    Norman Castle
    • #3
    • 8th Apr 18, 1:16 PM
    • #3
    • 8th Apr 18, 1:16 PM
    Call their bluff and not sign before the agreement runs out and hope they buy it quickly like they did the neighbours?
    Offer to sell it to them now. Explain they are willing to sell for an appropriate price.
    Don't harass a hippie. You'll get bad karma.

    Never trust a newbie with a rtb tale.
    • Lucyannexxx
    • By Lucyannexxx 8th Apr 18, 3:49 PM
    • 3 Posts
    • 0 Thanks
    Lucyannexxx
    • #4
    • 8th Apr 18, 3:49 PM
    • #4
    • 8th Apr 18, 3:49 PM
    Hi no they get nothing in their favour every time the re sign, tbh they are so desperate to sell they willingly sign each time the option needs extending. This time I've told them there's no guarantee planning will be granted if they do extend so atleas ask for more money or be persistent that they need to buy the house before it runs out.
    The developer is good at manipulating and always comes to my parents first as he knows they are desperate, hence the reason I said call their blufff and don't give them what they want to easily
    • Lucyannexxx
    • By Lucyannexxx 8th Apr 18, 3:52 PM
    • 3 Posts
    • 0 Thanks
    Lucyannexxx
    • #5
    • 8th Apr 18, 3:52 PM
    • #5
    • 8th Apr 18, 3:52 PM
    My dad said to them they need to just buy the house now but the developer came back and said basically the housing association are thinking of pulling out seeing as their plans were rejected and that if you all don't sign then it won't go ahead, making out like he's given them a lifeline and persuaded the housing to carry on if he can get extensions on the contracts. However he said they have already looked at plans for building 50 houses instead of flats so they obviously can't be that keen to suddenly shut it all down !!!55357;!!!56900;
    • ProDave
    • By ProDave 8th Apr 18, 3:55 PM
    • 1,058 Posts
    • 1,308 Thanks
    ProDave
    • #6
    • 8th Apr 18, 3:55 PM
    • #6
    • 8th Apr 18, 3:55 PM
    This sounds like shares in a company with a takeover bid, the share price rises.

    Likewise this property has development potential; so will be worth more than an "ordinary" house of the same size.

    I see two options, to be straight with the developer and tell them you need to sell now, but as soon as they see you are desparate, might reduce their offer.

    Or speak to an estate agent and see what they think it might sell for on the open market, given it's development potential.

    When they do sell, what will they do? they still need somewhere to live? How about suggesting to the developer they buy it, then allow your parents to remain as tenants until they are ready to start the development?
    • davidmcn
    • By davidmcn 8th Apr 18, 4:30 PM
    • 8,527 Posts
    • 8,987 Thanks
    davidmcn
    • #7
    • 8th Apr 18, 4:30 PM
    • #7
    • 8th Apr 18, 4:30 PM
    Given the amounts potentially involved, I would it worthwhile that your parents seek professional advice (from surveyors - your bog standard estate agents are unlikely to have expertise in development site assembly) about how best to negotiate this.
    Last edited by davidmcn; 08-04-2018 at 4:47 PM.
    • eddddy
    • By eddddy 8th Apr 18, 5:17 PM
    • 6,899 Posts
    • 6,829 Thanks
    eddddy
    • #8
    • 8th Apr 18, 5:17 PM
    • #8
    • 8th Apr 18, 5:17 PM
    Do your parents get paid for granting these options? If not what's in it for them?

    Presumably the developer does not have to action the option they could say we have PP but can only offer you 550k.
    Originally posted by Tom99
    Hi no they get nothing in their favour every time the re sign...
    Originally posted by Lucyannexxx
    It's usual for the house owner to only receive payment of 1 for the option.

    The 'deal' is typically something like this. The developer says:
    • "Your house is worth, say, 500k as a house."
    • "I'm willing to spend 20k+++ trying to get consent to build flats"
    • "If I get consent, I'll pay you 650k for your house."
    • "But you have to sign a legal agreement saying you will not sell to anyone else except me for 2 years - while I try to get planning consent"

    So the house owner signs the option agreement in the hope of getting a 150k windfall profit.
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